Career Pause or Full-Time Childcare? How to Navigate This Difficult Life Decision

As a working parent, one of the most significant decisions you'll face is whether to take a career pause to care for your child or continue working while paying for full-time childcare. It's a tough decision to make, as there are trade-offs and benefits for both sides. This article covers the factors to weigh when choosing between pausing a career and paying for childcare to help you make an informed decision.

Pausing a Career

Affordability: Taking a career pause can have a significant impact on your finances. If you decide to take time off work to care for your child, you'll be sacrificing your salary and any other benefits that come with your job, such as health insurance and retirement contributions. Depending on the length of your pause, this could result in a significant reduction in your overall earnings over your lifetime, potentially reducing the amount of Social Security benefits you ultimately receive.

Job prospects:  Pausing your career can also impact your future job prospects. When you re-enter the workforce, you could find it challenging to catch up to your peers who continued working during the same period. You may also miss out on important networking opportunities, training, and promotions that would have otherwise been available to you.

Paying for Full-Time Childcare

Childcare costs: Paying for full-time childcare can also be a significant expense. According to a 2021 report by Care.com, the average cost of center-based daycare for an infant in the United States is $14,940 per year. The cost of hiring a nanny is even higher, depending on your location and the qualifications of the caregiver. 

According to the department of labor, as analyzed by the Boston Globe, families in Middlesex County and Norfolk County, Massachusetts pay a median price of over $26,000 for center-based infant care annually. The only counties in the U.S. that ranked ahead of Middlesex and Norfolk counties were Arlington County, Virginia, and San Francisco County, California, according to the Globe.

Paying for full-time childcare can be a significant strain on your finances, especially if you're already living on a tight budget. It can also impact your ability to save for other important goals, such as a down payment on a house, a child's college education, and your retirement.

Deciding What is Best For Your Family

Benefits

Despite these financial trade-offs, there are benefits to taking a career pause or paying for full-time childcare. For example, taking a career pause can allow you to spend more time with your child during their early years. You'll have the opportunity to be more involved in their daily routines and milestones, which can be incredibly rewarding for parents. A career pause can also give you some time to reflect and plan if you have been considering changing your career focus or specialty. Many universities and companies now have workforce returnship programs.

On the other hand, paying for full-time childcare can provide your child with access to high-quality early education and socialization opportunities. It also keeps you contributing to your company retirement plan and you are available to take advantage of career advancement opportunities during that time period.  

A Personal Decision

Ultimately, the decision to take a career pause or pay for full-time childcare will depend on your individual circumstances and priorities. If you have a strong support network and can afford to take a career pause without significant financial strain, it is worth considering. On the other hand, if you decide to stay in the workforce or can't afford to take time off work, paying for full-time childcare may be the better option.

Get a Second Opinion

If you're struggling to make this decision, it may be helpful to speak with a financial advisor who can help you weigh the trade-offs of each option. They can also provide guidance on how to navigate the challenges of returning to the workforce after a career pause or finding high-quality, affordable childcare. Of course, it does not have to be an all or none decision. Depending on your area of expertise, working part-time or doing consulting work may give you the flexibility to manage your time around child care and work.

The financial trade-offs of a career pause versus paying for full-time childcare are significant, and the decision will depend on your individual circumstances and priorities. There is no right or wrong answer, but this decision can have long term ramifications that should be considered before implementing. By weighing the pros and cons of each option and seeking professional guidance, you can make an informed decision that's right for you and your family.

If you need help reviewing your own personal situation and options, schedule a complimentary consultation with me, a financial advisor specializing in wealth planning for parents who want to provide the best life for their family and still retire well.